Daily Coffee Market Outlook

NY- Sell (1)- A stronger USD and less than encouraging murmurs from China regarding interest rate increases sent the 'C' lower yesterday. However, Despite a brief probe below 130, the bears were not able to keep May below the lower support zone and the contract settled around 131. Today the onus remains on the downside. However, with the FOMC interest rate announcement due this evening, expect volumes to be low as traders pause in anticipation of what Bernanke has to say in terms of future direction. 130 should remain in support while 135 followed by 137 should cap the upside.

Liffe- Sell (1)- Early trading yesterday witnessed further losses as May made a charge for the 1200 bear target. Momentum was stopped short however as LDN recovered from the lows to close only a couple of dollars down. Momentum is still to the downside despite the bear 'failure' and we look for further losses today. The FOMC rate announcement this evening should ensure light volume and keep any movements muted.